2023 Channel Predictions – HPE Aruba

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By: Sherifa Hady, Vice President Channel Europe Middle East & Africa, at HPE Aruba

As the world marches ever onwards in its transition to a digital-first economy, the business landscape around us continues to shift in fundamental ways. Against the backdrop of increasingly distributed workplaces, rapid digital transformation and accelerated cloud adoption, business as usual is out of the window. 

For channel partners like yourselves, this will lead to new levels of customer service requirements as you are called upon to help businesses navigate, survive and thrive in this new reality. And with this, we will see the role of channel partners evolve from traditional resellers to service providers and trusted advisor. 

Looking ahead, channel partners have the opportunity to play an even greater role in the IT ecosystem in 2023. But doing so will rely on you anticipating customer needs and providing solutions to address arising issues, while also building and maintaining the capabilities to evolve alongside them. Here’s how I expect we’ll see partners adapt, and the areas where we’re anticipating significant growth and investment. 

The partner ecosystem will become increasingly complex as we accelerate towards multi-cloud environments 

The world of IT is characterized by ever increasing complexity. In 2023 organizations will continue to leverage technology to completely transform themselves in myriad ways – unlocking efficiency, fostering innovation and enabling new services and business models. While the potential of technology is endless, however, its adoption will continue to present businesses (and their IT teams) with the challenge of combining multiple, discrete elements – from networks and servers, to analytics tools and cloud platforms into a single dynamic environment. With Gartner estimating that over 85% of organizations will embrace the cloud-first principle by 2025, partners must be prepared to help their customers adapt as the technology becomes the new centrepiece for workloads. 

Chief Analyst at Canalys, James McBain, explains “The ‘decade of the ecosystem’ is here as the pressure on channel leaders intensifies to deliver results at a new level of scale, complexity and personalization… We are witnessing a once-in-a-generation shift in the global economy, and partnerships play a leading role. Most business leaders across every industry, of all size firms, and in every corner of the world are considering significant business model shifts. They are realizing that they can’t do it alone in the decade of the ecosystem.”

Looking ahead partners, vendors and service providers must update their business models to reflect the growing need to source distinct solutions and services from various IT organizations. Nowadays a customer might require connectivity from a service provider, look towards a vendor from a hardware perspective, involve a systems integrator to bring this together and then finally seek counsel from a specialist partner with relevant vertical expertise i.e. around healthcare or retail. Outside of vertical expertise we’re also expecting sustainability to be an increasing focus for businesses in 2023. Channel partners that can talk with credibility about helping companies reduce their energy footprints will stand out from the crowd. 

As the partner ecosystem rises – the reseller will be at the very forefront. As vendors, it will be our job to support this ecosystem and ensure we are purposefully partner-centred. The ability to build collaborative partnerships will be a key determinant to channel success for everyone.  

Partners must leverage the rising appetite for Network-as-a-Service (NaaS) – or risk losing out 

Hybrid work is here to stay, with Gartner predicting that if an organization were to go back to a fully on-site arrangement, it would risk losing up to 39% of its workforce. Set against the backdrop of distributed office locations, networks will grow more and more complicated as a spike in IoT devices rush to connect. It’s no wonder the transition from a hardware-driven industry to a software-first market, or an as-a-service-based economy will speed up. Research from Canalys shows this looks set to surge, predicting that the channel software market will reach $8.9 billion in revenue by 2027.

With distributed office locations the norm, securing the business inside and outside its boundaries in a flexible and scalable manner will be a key priority for your customers. To do so they must modernize their networks, unify their infrastructures and rethink their IT consumption models. 

To address this requirement and ensure seamless connectivity, organizations should look towards consumption-driven NaaS models to balance the cost of their network growth with the digital experience of their stakeholders.

Our own research has shown that interest in this model is rising – it is now being discussed in 86% of EMEA companies. Recognition of the channel’s role in its enhanced popularity is also clear – with IT resellers showing up strongly in respondents’ expectations of who they’d like to purchase NaaS from. Elsewhere, market indicators demonstrate that mass adoption is imminent, and so partners looking to succeed in 2023 must ready themselves to capitalize on this increased interest. 

This starts by working with vendors like Aruba to close any existing education gaps and address any customer confusion around the new concept. Broadening this beyond NaaS, channel partners like yourselves must play an increasingly role in articulating IT benefits in general and delivering technical consulting. Partnering with an experienced vendor means you can become a trusted advisor to your customers. What’s more, the ability to offer flexible payment models can increase the potential to generate recurring income, while also opening up new opportunities to layer specialist value-added services on top. 

Sustainability will soar to the top of the business agenda

As I’ve already mentioned, we’re also expecting sustainability to be an increasing focus for businesses in 2023. Canalys has confirmed that the environmental accountability of IT investments will be one of channel customers’ top priorities within the next two to three years.

NaaS adoption provides a concrete option for customers looking to pull sustainability levers as it presents them with sustainable networks that they can ‘rent’ from the experts on a subscription basis. By partnering with an experienced NaaS vendor, channel companies can benefit from a vendor’s depth and breadth of product and solution knowledge to provide a network configuration that optimizes energy consumption.

NaaS offerings should also be underscored by an environmental approach to networking across the entire IT supply chain. Channel partners will need to reassure customers that they are connected to certified sustainable vendors to make certain that sustainable objectives are embedded at the top of the value chain.

NaaS services are often accompanied by IT assed disposition (ITAD) services, a practice built around recycling or disposing of unwanted IT equipment in a safe and climate-conscious way. By embedding asset decommissioning strategies into their NaaS approach, partners can allow customers to play a part in the circular economy, where the life cycle of products is extended for as long as possible. 

Finally the model also allows customers to reduce the amount of IT equipment needed and operate their existing equipment at higher levels of utilization, offsetting environmental damage through hardware reuse and technology refreshes. 

The IT skills gap will exacerbate 

While the future IT landscape looks promising in regards to the depth and breadth of technologies out there, there is one key roadblock we must address – the growing digital skills gap. The Digital Economy and Society Index (DESI) shows that every third person who works in Europe lack basic digital skills. It has been estimated that 14 G20 countries could miss out on $11.5 trillion cumulative GDP growth if the skills gap isn’t addressed.

This tech talent shortage is impacting not only the IT sector, but of course every industry looking to make digital changes. Enlisted with delivering digital transformation, the channel must ensure that it is addressing these skills gaps both on behalf of customers and itself. As customers continue to look for IT implementations that are both focused and specialized, those in the channel must sharpen their expertise around these offerings. Channel partners must look for vendors that offer robust partner-centric programmes, equipping them with the knowledge needed to foster IT evolution. 

Conclusion 

2023 looks hopeful for those operating in the channel, as the role of resellers is set to strengthen. As businesses look towards new channel ecosystems where partners will take on increasingly important roles, it’s vital that you arm yourself with the right insights and offerings to underpin emerging services such as NaaS. In order to achieve this, and truly unlock competitive advantage by addressing your customers’ most pressing needs, you must find ways to close the IT skills gap and build out a resilient and talented workforce.